Dodd Frank Wall Street Reform Failure

On July 21, 2010, President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act, which is commonly referred as the Dodd-Frank Act. This act was passed as a response to the Great Recession in order to prevent potential financial debacle in the future. This regulation has a significant impact on American financial services industry by placing major changes on the financial regulation and agencies since the Great Depression. This paper examines the history and impact of Dodd-Frank Act on American financial services industry.

the causes that led to the 2008 crisis. They view Dodd-Frank as a comprehensive and powerful

The Consumer Financial Protection Bureau was created in 2010 as a response to the financial crisis of 2008. The government agency was established by the Dodd-Frank Act which President Barack Obama passed as a means of controlling and preventing excessive risk-taking ("Wall Street Reform: The Dodd-Frank Act"). The financial crisis occurred in part because of the limited regulation of financial institutions and the wave of irresponsible mortgage lending (The Economist). Subprime borrowers with poor credit histories and insufficient funds for repaying the loans were allowed to borrow money which they could not pay back, thus in turn initiating a nationwide housing market crash (The Economist). Many of these borrowers were granted these loans because of the poor judgement of banks and financial institutions, thus the government needed to create an institution which would protect consumers against unfair and deceptive practices. The mission of the Consumer Financial Protection Bureau is just that-to protect consumers in the financial marketplace by enforcing federal consumer financial laws (CFPB, 2016). In order to achieve this, the bureau monitors the financial market for potential risks to consumers and supervises companies in order to uncover institutions practicing abusive and fraudulent acts. Developing laws to create a fair market place is a top priority of the bureau, as it works to enforce these rules and regulations and make them more effective. The agency also conducts

The Dodd-Frank Wall Street Reform and Consumer Protection Act is a mammoth part of financial reform legislation passed by the Obama presidential term in 2010 as a reaction to the financial crisis of 2008. The act's many provisions, implied out over thousands of pages, are scheduled to be taken over a point of several years and are intended to decrease various risks in the U.S. fiscal system. The act established a number of new government agencies tasked with supervision over various components of the act. There are so many provisions, such as financial stability, orderly liquidation authority, transfer of power to comptrollers, FDIC and Fed, Hedge funds, insurance, pay it back Act, and Etc, which contribute to better department and regulations.

Named after the United States senator Christopher J. Dodd and the United States Representative Barney Frank, the Dodd–Frank Wall Street Reform and Consumer Protection Act was signed in to federal law by the president Barack Obama on July 21, 2010 in an attempt to prevent the events that led to the 2008 financial crisis of occurring again. Commonly known as the Dodd-Frank, the act brought the biggest changes to regulations on financial institutions since the reforms on regulations that followed the Great Depression. The act creates regulatory agencies for financial institutions, as well as an oversight council that is in charge of assessing systemic risk. The council also has the power of restraining the growth of large financial institutions

Financial regulators and politically motivated critics of bad credit loans have proposed many regulations that target payday-style loans such as requiring greater due diligence in processing the loans, limiting interest rates and simply banning the loans in certain states. However, the government's own Federal Deposit Insurance Corporation released a national study in October of 2014 that found about 34 million households don't participate in the banking system. These people depend on alternative financial resources like check cashing companies, bad credit loans and payday and title loan

The Dodd-Frank Wall Street Reform and Consumer Protection Act is a massive piece of financial reform legislation passed by the Obama administration in July 2010 as a response to the financial crisis of 2008. Named after sponsors U.S. Senator Christopher J. Dodd and U.S. Representative Barney Frank, the act's numerous provisions, spelled out over roughly 2,300 pages, are being implemented over a period of several years and are intended to decrease various risks in the U.S. financial system. The law was initially proposed by the Obama administration in June 2009, when the White House sent a series of proposed bills to Congress. A version of the legislation was introduced

In the wake of the 2008 financial crisis, a Democrat Congress and President Barack Obama passed the Dodd-Frank Act, which in turn unleashed a flood regulations and created the CFPB. While their intent of protecting the little guy is praiseworthy, the legislation had the opposite effect. Since its inception, the CFPB became

The united states is currently the proprietor of nearly nineteen trillion dollars in debt, and that number continues to increase to by 2.53 billion per day. With close to three hundred million people in the united states each shared citizen’s debt would be around sixty-one thousand dollars. (debt calculator website). In 2008 at the end of the George bush administration the country was said to be in the worst economic recession since the great depression. The current president of the united states, Barack Obama and his administration proposed a bill to congress in 2009, that was believed to assist in the prevention of another recession. This bill was titled “The Dodd Frank initiative and consumer protection act.” It was named after the two legislators who created it, Chis Dodd and Barney Frank. This initiative was, and continues to be, considered a “massive” piece of legislation. (quote). Although introduced, It did not pass in congress until July 21, 2010. In addition to assisting with the economy, this act was created to help insure that consumers would not be easily taken advantage of by major financial agencies and corporations. All of us, no matter age, gender, or financial status are consumers. This act has put checks and balances in place that will protect all families from making financial decision that might cripple them into a situation that may make it impossible to get out

The Glass Steagall Act was passed on 1933, which is also known as The Banking Act to tighten regulation on the way banks did their business. This act was written as an emergency measure when about 5,000 banks failed during the Great Depression. Banks mostly failed because of the way they would invest with money. The act prohibits banks from investing money on investments that turn out to be risky. Banks could no longer sell securities or bonds. The act also created Federal Deposit Insurance Corporation (FDIC) to protect the deposits of individuals, which is still used to this date. The FDIC in this era insures your deposits in your bank up to $250,000. This gave the public confidence again to deposit their money in the bank. In 1933

(Danzer)Also, the “Glass-steagall Act” in 1933 provided insurance for individual banks to make sure the customers’ money was in a safe place. (Danzer) The “Fair Labor standards Act” in 1938 limited the working hours and the working age for the entire country. (Danzer)This was the same in 2008, when the government favored public safety,which by published “The consumer protection act”by giving consumer protection at different area like bank and house market.Obama also introduced a new financial regulatory system. "(Securities)Then,The CFPB was an agency of U.S. government produced in 2010. It also provided protection in the financial system, make sure the money consumers invest will be back. The agency include banks, credit unions, mortgage department and many other debt companies in the United States.(“Consumer”) All in all, after the crisis, government realized they can’t hands-off anymore, they have to step in and protect the public safety since the whole economic system gone

people's need for extra funding has led to the extension of credit to large segments of the population who were previously deemed unqualified. However, some lenders have tried

When the housing bubble has burst in both sides of the Atlantic in 2007, the regulatory system has failed not only to effectively manage the risk, but also to require sufficient transparency and emphasized the vital importance of a well-regulated financial system. As a response of the crisis, the United States launched the most powerful financial regulatory reform plan in the U.S. history since the 1930s: The Dodd-Frank Wall Street Reform and Consumer Protection Act (‘the Dodd-Frank Act’ or ‘the Act’). The new regulatory framework has reached to every corner of the financial sector, in order to reduce the risk and as a result to reduce systemic threats to the broader financial system. Under the Act, the role of the Federal Reserve has

While Wall Street can easily afford massive fines, and increased compliance costs, community bankers and others who make up the backbone of Main Street America can not. This regulatory burden is suffocating one of the life-line financing mechanisms for small business. In fact, the cost of compliance with one-size-fits-all regulations from CFPB and other regulators is now the number one threat to community banks.

Inside Job is a documentary that covers the 2008 financial crisis. The first part of the documentary focuses on what led to the financial meltdown. In the 1980 's the finance industry exploded after investment banks went public, leading these firms to have an excess of stockholder 's money. Then the president at the time, Ronald Reagan, began a 30 year period of financial deregulation. Reagan deregulated savings and loan companies which allowed them to make risky investments with depositor 's money, which led to taxpayers paying $124 billion dollars when they inevitably failed. Executives in these companies were also stealing money from their depositors. Another problem was that many of the executives from these investment banks ended up being put into powerful positions in the government where they pushed for even more deregulation. In the late 90 's the internet bubble burst after investment banks knowingly promoted internet companies they knew would fail. A financial innovation known as derivatives became a $50 trillion business yet they were completely unregulated. When there was an attempt to regulate this market, it was almost immediately shut down and a law was put in place banning all regulation of derivatives. Under these new rules it created a new securitization food chain. Investment banks were creating complex derivatives called collateralized debt obligation and selling these debts to investors. Then these CDO 's were rated by rating agencies, with most of them